Summary
This appeal concerned the issue of a Security Notice under the provisions of Schedule 11 paragraph 4(2)(a) of the VAT 1994. The original sum was £958,000 for quarterly VAT returns or £850,600 for monthly returns. On the 8 November 2011 the respondents wrote advising a reduction in the security required of £638,000 for quarterly returns or £530,600 for monthly returns.
Background
HMRC have outstanding proceedings against the Appellant in regard to a potential MTIC fraud which they deny and is the subject of a separate appeal. As a result of this the appellant has withheld payment of VAT properly due to HMRC in order to net off the input tax that HMRC have withheld.
The Appellant has, to the knowledge (and possibly also to the irritation) of HMRC pursued a policy of responding to set-offs by HMRC of VAT subsequently overpaid by
